July 31, 2018 / 5:55 PM / 7 months ago

Thyssenkrupp cuts profit guidance on cost overruns at industrial unit

FRANKFURT, July 31 (Reuters) - Thyssenkrupp, the German engineering group shaken by activist investors, cut its earnings forecast on Tuesday, citing cost overruns at plant engineering and ship building projects.

The guidance for adjusted operating profit in the 2017/2018 fiscal year was now for around 1.8 billion euros ($2.11 billion), at the lower end of the previously forecast range of 1.8 to 2 billion euros.

“The main negative factors were higher expected total costs, particularly for a marine project in Turkey, a cement plant in Saudi Arabia and a biofuel power plant in Australia,” it said in a statement.

Group free cash flow before mergers and acquisitions for the full year would be negative, where it had previously seen a positive figure.

Still, the outlook for group net income was for a significant improvement from the previous year’s 271 million euros, it added. ($1 = 0.8548 euros) (Reporting by Ludwig Burger; editing by Emelia Sithole-Matarise)

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